Cache Logistics Trust (CACHE) reported 1Q13 DPU of 2.234 S cents, up 7.1% YoY. This is in line with our expectations, given that the quarterly DPU made up 26.5% of our DPU forecast. The strong performance was mainly attributable to upward rental adjustments and incremental contribution from its past acquisitions. As at 31 Mar, the portfolio assets remained 100% occupied, with a healthy weighted average lease to expiry of 3.7 years. We also understand that CACHE has secured a new tenant, Agility Logistics, for its lease at APC Distrihub during the quarter. With this, CACHE has fully addressed its lease expiry in 2013, with zero renewals due for the rest of the year. CACHE currently has an aggregate leverage of 29.2% and a stable all-in financing cost of 3.52%. This provides CACHE with ample flexibility and firepower to pursue its growth opportunities. We are maintaining our BUY rating with a higher fair value of S$1.45 (S$1.33 previously) on CACHE.
Consistent set of 1Q13 results
Cache Logistics Trust (CACHE) released its 1Q13 results last evening. NPI rose 12.4% YoY to S$18.1m, forming 23.4% of our FY13F NPI, while distributable income increased 18.3% to S$15.8m, meeting 24.7% of our full-year income projection. DPU for the quarter came in at 2.234 S cents, up 7.1% YoY despite being partially impacted by an enlarged unit base following the private placement in Mar. This is also in line with our expectations, given that the quarterly DPU made up 26.5% of our DPU forecast (consensus: 25.4%).
Strength seen across all operating metrics
The strong performance was mainly attributable to upward rental adjustments and incremental contribution from its past acquisitions. As at 31 Mar, the portfolio assets remained 100% occupied, with a healthy weighted average lease to expiry of 3.7 years (4Q12: 3.9 years). We also understand that CACHE has secured a new tenant, Agility Logistics, for its lease at APC Distrihub during the quarter. With this, CACHE has fully addressed its lease expiry in 2013, with zero renewals due for the rest of the year.
Maintain BUY with higher fair value
Looking ahead, CACHE expects to continue to deliver sustainable growth for FY13, as it carries on its pursuit to acquire yield-accretive assets across its key markets such as Singapore, China and Malaysia, as well as to grow organically. We note that CACHE has recently completed the acquisition of Precise Two, a new ramp-up warehouse, at an attractive NPI yield of 8.7% on 1 Apr. This is likely to contribute ~4.2% to its FY13 NPI, based on our projections. CACHE currently has an aggregate leverage of 29.2% (down from 31.7% in 4Q12) and a stable all-in financing cost of 3.52%. This provides CACHE with ample flexibility and firepower (~$100m debt headroom based on 35% debt ceiling) to pursue its growth opportunities. We are raising our fair value from S$1.33 to S$1.45 on firmer cap rates and RNAV assumptions. Maintain BUY on CACHE.
Cache Logistics Trust (CACHE) released its 1Q13 results last evening. NPI rose 12.4% YoY to S$18.1m, forming 23.4% of our FY13F NPI, while distributable income increased 18.3% to S$15.8m, meeting 24.7% of our full-year income projection. DPU for the quarter came in at 2.234 S cents, up 7.1% YoY despite being partially impacted by an enlarged unit base following the private placement in Mar. This is also in line with our expectations, given that the quarterly DPU made up 26.5% of our DPU forecast (consensus: 25.4%).
Strength seen across all operating metrics
The strong performance was mainly attributable to upward rental adjustments and incremental contribution from its past acquisitions. As at 31 Mar, the portfolio assets remained 100% occupied, with a healthy weighted average lease to expiry of 3.7 years (4Q12: 3.9 years). We also understand that CACHE has secured a new tenant, Agility Logistics, for its lease at APC Distrihub during the quarter. With this, CACHE has fully addressed its lease expiry in 2013, with zero renewals due for the rest of the year.
Maintain BUY with higher fair value
Looking ahead, CACHE expects to continue to deliver sustainable growth for FY13, as it carries on its pursuit to acquire yield-accretive assets across its key markets such as Singapore, China and Malaysia, as well as to grow organically. We note that CACHE has recently completed the acquisition of Precise Two, a new ramp-up warehouse, at an attractive NPI yield of 8.7% on 1 Apr. This is likely to contribute ~4.2% to its FY13 NPI, based on our projections. CACHE currently has an aggregate leverage of 29.2% (down from 31.7% in 4Q12) and a stable all-in financing cost of 3.52%. This provides CACHE with ample flexibility and firepower (~$100m debt headroom based on 35% debt ceiling) to pursue its growth opportunities. We are raising our fair value from S$1.33 to S$1.45 on firmer cap rates and RNAV assumptions. Maintain BUY on CACHE.
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